Verwaayen 'worth every cent'

Wednesday 16 July 2003 17:41 BST

TELECOMS giant BT has defended the £2.1m package paid to chief executive Ben Verwaayen, saying he is 'worth every cent' given the group's improving financial fortunes.

Verwaayen was lured to BT last year from the US with the promise of a £750,000 housing allowance and a relocation payment of £200,000. That was on top of his annual salary and options on 1.4m BT shares.

The National Association of Pension Funds called the deal 'excessive' and shareholders at BT's annual meeting today questioned whether it was an appropriate use of funds.

But chairman Sir Christopher Bland said the inducements were necessary to attract the best possible talent to one of Britain's most high-profile executive roles.

'It was what we needed to pay to get the competence that we now have - the best man arguably in the world for this particular job,' Bland said in response to a barrage of shareholder questions. 'It was worth it.'

BT also came under fire for not linking remuneration to share price performance. But it moved to head off shareholder fury by pledging to pay out 50% of earnings as dividends within two to three years.